After World War
II, a republic was set up in the southern half of the Korean
Peninsula while a communist-style government was installed
in the north. The Korean War (1950-53) had US and other UN
forces intervene to defend South Korea from North Korean
attacks supported by the Chinese. An armistice was signed in
1953 splitting the peninsula at the 38th parallel known as
the DMZ. Thereafter, South Korea achieved rapid economic
growth, with per capita income rising to 13 times the level
of North Korea. In 1997, the nation suffered a severe
financial crisis from which it continues to make a solid
recovery. South Korea has also maintained its commitment to
democratize its political processes. In June 2000, a
historic first south-north summit took place between the
south's President KIM Dae-jung and the north's leader KIM
Chong-il. In December 2000, President KIM Dae-jung won the
Noble Peace Prize for his lifeling committment to democracy
and human rights in Asia. He is the first Korean to win a
Nobel Prize.

cabinet: State Council appointed by the
president on the prime minister's recommendation

elections: president elected by popular vote
for a single five-year term; election last held 18 December
1997 (next to be held by 18 December 2002); prime minister
appointed by the president; deputy prime ministers appointed
by the president on the prime minister's recommendation

note: on 20 January 2000, the National Congress
for New Politics or NCNP was renamed the Millennium
Democratic Party or MDP

Political
pressure groups and leaders:

Federation of
Korean Industries; Federation of Korean Trade Unions; Korean
Confederation of Trade Unions; Korean National Council of
Churches; Korean Traders Association; Korean Veterans'
Association; National Council of Labor Unions; National
Democratic Alliance of Korea; National Federation of
Farmers' Associations; National Federation of Student
Associations

As one of the
Four Dragons of East Asia, South Korea has achieved an
incredible record of growth. Three decades ago GDP per
capita was comparable with levels in the poorer countries of
Africa and Asia. Today its GDP per capita is seven times
India's, 16 times North Korea's, and comparable to the
lesser economies of the European Union. This success through
the late 1980s was achieved by a system of close
government/business ties, including directed credit, import
restrictions, sponsorship of specific industries, and a
strong labor effort. The government promoted the import of
raw materials and technology at the expense of consumer
goods and encouraged savings and investment over
consumption. The Asian financial crisis of 1997-99 exposed
certain longstanding weaknesses in South Korea's development
model, including high debt/equity ratios, massive foreign
borrowing, and an undisciplined financial sector. By 1999
GDP growth had recovered, reversing the substantial decline
of 1998. Seoul has pressed the country's largest business
groups to restructure and to strengthen their financial
base. Growth in 2001 likely will be a more sustainable rate
of 5%.